Getting a Mortgage on a Steel Frame Property
Need a steel frame house mortgage? Don't worry, it's easier than you think! Our guide will tell you exactly what you need & how to apply for a mortgage like this.
Firstly, what is the construction type of the property?
No impact on your credit score
Author: Pete Mugleston - Mortgage Expert, MD
Updated: February 14, 2022
Not every home is built with just brick, tiles and mortar and the type of construction can directly limit the number of mortgage options available to you.
So, if you’re considering a house with a steel frame, there’s some important issues to consider before you press forward.
To assist you in your search, this guide will explain everything you need to know.
This will include how a steel frame construction can impact mortgage options, where to find lenders offering competitive loans, and points to be aware of during the process.
The following topics are covered below...
Can you get a mortgage on a steel framed house?
It’s definitely possible to get a mortgage on a house with a steel frame, but it can be quite difficult.
This is because it’s a fairly uncommon type of home construction.
The use of a steel frame means the property would be considered ‘non-standard construction’, which will immediately limit the number of lenders who are willing to provide a loan.
The reason lenders are more reluctant to offer a mortgage for this type of property is because of the perception that the construction carries higher risks.
The fear is based around possible repair costs and difficulties reselling the house. Whether or not a lender will consider offering a loan on a steel-framed house will depend on a number of factors.
One of the major considerations will be the exact construction of the property in question. This is because some steel builds are more reliable than others.
Worries over the building’s structural durability also means most lenders will have stricter terms or even require specialist insurance
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What are some common types of steel frame properties?
In the grand scheme of things, steel frame constructions are uncommon in the UK, but they are out there.
Each type of steel-framed building will be fairly unique and come with a variety of attributes.
Most of the properties you come across will be named after the manufacturer, some common examples include:
- Wimpey No-Fines
- BISF (British Iron and Steel Federation)
- Trusteel MKII/3M
Usually you’ll find significant differences in the age, material quality, and structure of each property.
So, if you’re considering a purchase, it’s really worth using the assistance of an expert broker who understands this construction type.
This is because they’ll be able to pair you with the right lenders who are comfortable with steel-framed homes.
How a broker can help you get a mortgage for this type of property
Only a small number of lenders will entertain the idea of providing a mortgage for a house with a steel frame.
This is going to limit your choices and make it harder to find the best deals.
Luckily, the experienced brokers we work with will know exactly which lenders in your area will consider loans for your specific property and personal circumstances.
Doing this is going to save you a lot of time and energy. It will make the whole process much more straightforward and prevent you from running into dead ends.
At the end of the day, assistance from an expert broker will likely mean a better mortgage deal for you. So in summary, a more pleasant experience whilst potentially saving you money at the same time – win-win.
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Tips for viewing this type of property and questions to ask
If you’re thinking of purchasing a house with a steel frame, there’s some crucial questions to ask about the construction before you pursue a mortgage.
Firstly, you need to know exactly what type of construction methods have been used for the build.
Then, some further questions to ask include:
- Whether any reinforcement work has already taken place
- Is it possible to reinforce or toughen the building structure?
- How old is the property?
- Are there any maintenance records or reports available?
- Were there any past difficulties securing insurance?
It’s extremely useful to speak with a broker who has experience dealing with this type of construction.
They’ll be able to instruct you on exactly which questions to ask. Not only this, but they’ll be able to set you up with the specialist insurers offering the best deals.
Just make an enquiry and we’ll introduce you to an expert broker for free.
Due to the potential risks of non-standard steel frame constructions, most mortgage providers will have stricter requirements and many of them base their lending decision on the valuer’s comments.
Specific requirements for these properties can include the following…
- Higher deposit requirements for a lower loan-to-value LTV amount. The LTV can be anywhere between 50-80%, although exceptions can be made
- Stricter affordability checks – you might find it more difficult to borrow more than the standard 4.5 times your annual income
- Proof of suitable insurance
- A lower appetite for risk. For example, they might be less likely to lend if you have bad credit, are self-employed with limited income proof or over the age of 75
- Some mortgage providers won’t lend on older steel frame properties. You might need a specialist lender if the property was built during or before the early 1980s.
Even with a larger deposit, lenders may charge a higher level of interest to offset the added risk that comes with a steel-framed house.
So, if you want to see the best rates and terms available for your circumstances, speaking with an expert advisor is going to allow you access to the full range of options.
It’s also worthwhile downloading your credit reports and getting your broker to go through them with you. Because lenders can be stricter about mortgages for this type of construction, you’ll want your credit scores in the best shape possible.
A specialist broker will be able to assess your reports and then instruct you on ways to improve your application.
If you’ve been declined a mortgage for a house with a steel frame, don’t panic. We can match you with an advisor who’s experienced in dealing with previously rejected applicants.
Their assistance could involve renegotiating with the same lender or finding you a new one. But it’s the best way to prevent any further unnecessary marks on your credit file.
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Recommended surveys and reports for steel-framed homes
If you’re considering a home constructed using metal or steel, it’s worthwhile getting a RICS Level 3 Building Survey.
This will give you a comprehensive insight into the construction details of the home.
It’s vital you use a RICS surveyor who has plenty of experience surveying steel frames because they will be able to spot issues that others might miss.
You might also need to obtain a report from a qualified structural engineer who can provide an in-depth technical evaluation. The mortgage brokers we work with can assist you to get suitable surveys set up.
Getting matched with a non-standard construction specialist
Getting a mortgage for a house with a steel frame can be a challenge. It’s difficult to find lenders, and you’ll likely face stricter conditions along with higher rates.
By using our free broker-matching service, we’ll pair you up with a specialist who has experience dealing with steel-framed properties.
This tailored service means they’ll be able to introduce you to the right lenders from day one, and find you the best deal for your circumstances.
All you need to do is call 0808 189 0463 or make an enquiry and we’ll set up a free, no-obligation chat between you and a skilled broker today.
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Maximise your chance of approval with specialist advice from a mortgage expert.
Yes, the age of the steel-framed house will usually make a difference.
Often, newer homes will be built to a higher standard, but this isn’t always the case. So, it’s important that you get some expert advice to fully understand the construction of the property you’re dealing with.
The majority of steel-framed homes were built after the Second World War.
And in most cases, were only supposed to be temporary constructions. This is why they’re not built with the same kind of longevity in mind as other types of houses.
One option is to reinforce the whole structure with brick. But this can be an extremely expensive path to go down.
Before paying out for pricey building work, the best way to increase your chances of getting a mortgage will involve speaking to the correct lenders for your situation.
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Mortgage Expert, MD
About the author
Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.
Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!